Dollar mixed ahead of Fed announcement on rate policy

WanfengZhou

NEW YORK (MarketWatch) - The dollar traded higher against the yen, but fell against other major rivals early Tuesday, with caution prevailing in the marketplace ahead of an imminent announcement on interest rates by the U.S. Federal Reserve. The Federal Open Market Committee announces a decision on interest rates at 2:15 p.m. today. Markets are widely expecting the Fed to lift the benchmark federal funds rate by 25 basis points for a 15th straight time, bringing rates up to 4.75%. Investors will scrutinize the statement accompanying the decision for any hints about the Fed's leanings on future rate increases. Meanwhile, the euro and other European currencies were lifted by a stronger-than-expected German business sentiment report and strong growth in money supply. The dollar was last up 0.3% at 116.69 yen, while the euro traded up 0.7% at $1.21.

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